Brent breaks $90 as war premium takes hold
Brent crude blew past $90 a barrel on Friday after President Donald Trump demanded unconditional surrender from Iran, adding fresh fuel to a rally that has already rewritten the record books this week. The global benchmark climbed 5.65% to $91.06, while WTI crude shot up 7.97% to $88.98.
The numbers for the week tell the story. Brent gained roughly 26% and WTI about 30%, the steepest weekly advance for both benchmarks since the early months of the Russia-Ukraine war in 2022.
Hormuz shutdown grinds into second week
Shipping through the Strait of Hormuz, the 21-mile-wide chokepoint between Iran and Oman, has all but stopped. Tanker tracking data shows a 70% plunge in vessel traffic since Operation Epic Fury began on February 28, and more than 150 ships are anchored outside the strait waiting for safe passage that may not come soon.
About 20.5 million barrels of oil pass through the waterway on a normal day. That is roughly one-fifth of global consumption. With that flow choked off, the market has scrambled to reprice risk at a speed not seen in years.
Iran's Islamic Revolutionary Guard Corps warned the strait is "no longer a safe passage for those who support aggression." Qatar's energy minister went further, saying Gulf exporters would have to halt production within days if tankers cannot transit. Wood Mackenzie put a number on the worst case: $150 a barrel if the blockade drags on.
Washington scrambles to contain fallout
The White House has thrown several ideas at the problem. Trump ordered Navy escorts for commercial tankers and directed the Development Finance Corporation to backstop war-risk insurance for Gulf shipping. The Navy cautioned it lacks the escort capacity for a sustained operation.
The Treasury Department floated the idea of intervening directly in oil futures markets, a move that would be virtually unprecedented. By Thursday, though, administration officials were already walking it back, telling reporters that the department's ability to meaningfully move crude prices through trading is limited. Bloomberg reported Friday that the White House is now downplaying the proposal.
OPEC+ adds barrels, but not enough to matter
On March 1, eight OPEC+ members approved a 206,000 barrel-per-day production increase starting in April. Analysts had expected a smaller hike, so the decision briefly eased nerves. But 206,000 barrels is a rounding error when 20 million barrels a day are at risk. The group stopped short of a larger boost, wary of oversupply if the conflict resolves quickly.
Saudi Arabia, Russia, Iraq, the UAE, Kuwait, Kazakhstan, Algeria, and Oman will hold monthly meetings to reassess. For now, the modest increase does little to plug the gap.
What comes next
Traders are watching three things. First, whether Navy escorts actually begin and insurers follow Washington's lead on war-risk coverage. Second, any signal from Tehran that it might reopen the strait, even partially. Third, the EIA's weekly inventory report, due next Wednesday, which will offer the first hard data on how US stockpiles are absorbing the shock.
Goldman Sachs had forecast Brent at $60 for the fourth quarter of 2026. That call looks like ancient history now. As long as Hormuz stays closed, the only real question is how much higher prices can go.